Tuesday's news, notes and observations are after the jump. Also see Mark Lacter's morning headlines at LA Biz Observed and follow us on Twitter.

• State budget stories roundup. Rough & Tumble
• The CEO of MTA recommended against the politically charged AnsaldoBreda contract to build 100 light rail cars, saying they are incompatible and too heavy. LAT
• Emigdio Preciado Jr., who had been listed as one of the FBI's 10 most wanted for an attack on an L.A. County sheriff's deputy, was arrested in Mexico and will be returned. LAT
• Laurette Healey dropped out of the CD2 city council race. Sausage Factory
• The City of Los Angeles was urged to consider privacy and security risks before switching its secure computer services to Google. Info Week
• The City Council's Public Safety Committee approved a draft ordinance to allow only one rooster per property citywide. LAT
• Could a Constitutional Convention fix California government? KCRW/WWLA
• Southern California engineers build the Apollo spacecraft that went to the moon. KPCC News
• State researchers said Monday that deaths related to a heat wave in 2006 were probably two to three times higher than estimated by coroner's reports. LAT
• A 21-year-old man fatally shot outside a party in the Crenshaw area was the son of a Los Angeles Police Department officer who mentors young black males to stay out of gangs. Fox 11
• Torey Van Oot, formerly of USC Annenberg, has joined the Sacramento Bee as chief Capitol Alert correspondent. Bee
• Former LAT investigative editor Deb Nelson hopes to create the newsroom of the future. Romenesko
• At 11:30 a.m. Larry Mantle talks with Stacy Perman, author of "In-N-Out Burger: A Behind-the-Counter Look at the Fast-Food Chain That Breaks All the Rules." KPCC